ACCT 303 - Chapter 9

अब Quizwiz के साथ अपने होमवर्क और परीक्षाओं को एस करें!

total budget variance

the difference between the actual cost of an input and its planned cost.

unit standard cost

the product of these two standards: Standard price × Standard quantity (SP × SQ).

Quantity standards

the quantity of input allowed per unit of output.

standard quantity of materials allowed

the quantity of materials that should have been used to produce the actual output (Unit materials standard × Actual output).

Ideal standards

standards that reflect perfect operating conditions.

fixed overhead spending variance

the difference between actual fixed overhead and applied fixed overhead.

fixed overhead volume variance

the difference between budgeted fixed overhead and applied fixed overhead; it is a measure of capacity utilization.

Price (rate) variance

the difference between standard price and actual price multiplied by the actual quantity of inputs used.

standard cost sheet

a listing of the standard costs and standard quantities of direct materials, direct labor, and overhead that should apply to a single product.

standard bill of materials

a listing of the type and quantity of materials allowed for a given level of output.

Currently attainable standards

a standard that reflects an efficient operating state; it is rigorous but achievable.

favorable (F) variance

a variance produced whenever the actual amounts are less than the budgeted or standard allowances.

Which of the following equations measures the direct labor rate variance? a.(AR × SH) − (SR × AH) b.(SR × AH) − (SR × SH) c.(AR × AH) − (SR × AH) d.None of these choices are correct.

c.(AR × AH) − (SR × AH)

Which of the following statements is true regarding mix variance? a.It shows the difference between the amount of output that was produced versus the expected output for a given amount of input. b.It is the difference between the actual amount of each input and its standard mix amount. c.It shows the impact of different costs of inputs used on the input proportions. d.It is the difference in the standard cost of the actual mix of inputs used and the standard cost of the mix of inputs that should have been used.

d.It is the difference in the standard cost of the actual mix of inputs used and the standard cost of the mix of inputs that should have been used.

Kaizen standards

efforts to reduce the costs of existing products and processes.

unfavorable (U) variance

a variance produced whenever the actual input amounts are greater than the budgeted or standard allowances.

Gamma Company manufactures ketchup using tomatoes and sugar. The following standard mix was developed for producing 5,000 pounds of ketchup: Direct Material Mix Mix Proportion Standard Price StandardCost Tomatoes 9,000 lbs 0.90 $1.20 $10,800 Sugar 1,000 lbs 0.10 $0.50 $ 500 Total 10,000 lbs $11,300 Gamma Company put a batch of 5,000 pounds of tomatoes and 500 pounds of sugar into process. The actual yield was 2,250 pounds of ketchup. Calculate the mix variance. a.$35 unfavorable (U) b.$25 favorable (F) c.$35 favorable (F) d.$60 unfavorable (U)

a.$35 unfavorable (U) (AQ - SM) x SP Tomatoes = $60 U Sugar = ($25) F Total = $35 U

The formula for the fixed overhead spending variance is: a.AFOH − BFOH b.(AH − SH) × SVOR c.Standard fixed overhead rate × Standard Hours d.Applied fixed overhead − budgeted fixed overhead

a.AFOH − BFOH

Price/rate variances focus on the differences between a.actual and standard unit prices of an input multiplied by the actual quantity of inputs. b.actual and standard unit prices of an input multiplied by the budgeted quantity of inputs. c.actual and standard inputs multiplied by actual prices. d.actual and standard inputs multiplied by standard prices.

a.actual and standard unit prices of an input multiplied by the actual quantity of inputs.

A five-percent wage increase for all factory employees would affect which of the following variances? a.direct labor rate variance b.direct labor efficiency variance c.direct materials price variance d.variable manufacturing overhead efficiency variance

a.direct labor rate variance

Standard costing a.establishes price and quantity standards for inputs. b.provides journal entry support. c.is not used in unit costing. d.None of these choices are correct.

a.establishes price and quantity standards for inputs.

Which of the following people is most likely responsible for an unfavorable variable overhead efficiency variance? a.production supervisor b.personnel director c.accountant d.supplier

a.production supervisor

The following condition which demands maximum efficiency and can be achieved only if everything operates perfectly is called: a.Personnel standards b.Ideal standards c.Budget standards d.Currently attainable standards

b.Ideal standards

Which of the following items does a standard cost sheet include? a.Actual price of fixed overhead b.Standard price of direct labor c.Standard tax rate d.Actual usage of direct materials

b.Standard price of direct labor

Which of the following is true about the variable overhead spending variance? a.The variable overhead spending variance is calculated by deducting actual variable overhead from standard variable overhead. b.The variable overhead spending variance measures the aggregate effect of differences in the actual variable overhead rate and the standard variable overhead rate. c.The variable overhead spending variance is calculated by deducting actual direct labor hours used from standard direct labor hours that should have been used. d.The variable overhead spending variance measures the change in variable overhead consumption that occurs because of efficient (or inefficient) use of direct labor.

b.The variable overhead spending variance measures the aggregate effect of differences in the actual variable overhead rate and the standard variable overhead rate.

While accounting for overhead variances, overhead is applied to production by: a.debiting the variable and fixed overhead control accounts and crediting the work in process account. b.debiting the work in process account and crediting the variable and fixed overhead control accounts. c.debiting the fixed overhead control account and crediting the variable overhead control account. d.debiting the variable overhead control account and crediting the fixed overhead control account.

b.debiting the work in process account and crediting the variable and fixed overhead control accounts.

Variances indicate a.who is responsible for the variance. b.that actual performance is not going according to plan. c.the cause of the variance. d.when the variance should be investigated.

b.that actual performance is not going according to plan.

Materials usage variance is: a.the difference between the actual and standard price per unit of materials purchased. b.the difference between the actual and standard quantity of materials multiplied by the standard unit price of the materials. c.the difference between actual quantity of materials used and actual quantity of materials purchased. d.the difference between materials used in production and purchased for production.

b.the difference between the actual and standard quantity of materials multiplied by the standard unit price of the materials.

The standard cost sheet includes all of the following EXCEPT a.the standard cost per unit. b.the standard material costs per unit. c.the standard labor hours allowed for actual production. d.the standard quantity per unit.

b.the standard material costs per unit.

Which of the following factors would cause an unfavorable labor rate variance? a.using more unskilled workers b.using more highly skilled workers c.using higher quality materials d.using low-efficiency workers

b.using more highly skilled workers

Augustus, Inc., manufactures cookies. Augustus provided the following information for the month of June: Units produced: 150,000 packages Standard direct labor hours per package: 0.50 hours Standard variable overhead rate (per direct labor hour): $3 Actual variable overhead costs: $235,750 Actual hours worked: 77,800 Calculate the total variable overhead variance. a.$10,750 favorable b.$15,500 favorable c.$10,750 unfavorable d.$15,500 unfavorable

c.$10,750 unfavorable Expected Variable OH = 150,000 * 0.50 * $3.00 = 225,000 Actual Variable OH = 235,750 Difference = -10,750

Which of the following statements is true about a standard cost sheet? a.It cannot be used for inputs associated with tangible products. b.It shows the historical cost of inventory whose valuation is to be done as per the standards revealed in the standard cost sheet. c.It shows the amount and cost of direct materials, direct labor, and overhead needed to make one unit of output. d.It is used in manufacturing firms only.

c.It shows the amount and cost of direct materials, direct labor, and overhead needed to make one unit of output.

Which of the following variance analysis methods requires a company to identify the actual variable and fixed costs as well as budgeted rates and costs? a.The three-variance analysis method b.The comparative variance analysis method c.The four-variance analysis method d.The common-size variance analysis method

c.The four-variance analysis method

The usage variances focus on the difference between a.actual quantity used and standard quantity allowed for budgeted production. b.actual costs of inputs and standard costs of inputs. c.actual quantity used and standard quantity allowed for actual production. d.both "actual quantity used and standard quantity allowed for actual production" and "actual costs of inputs and standard costs of inputs".

c.actual quantity used and standard quantity allowed for actual production.

A materials price variance would NOT be caused by a.ordering from the wrong supplier. b.ordering the wrong quality of materials. c.requiring laborers to work overtime. d.not taking a quantity discount.

c.requiring laborers to work overtime.

The standard cost sheet includes all of the following EXCEPT a.the standard price. b.the standard cost per unit. c.the standard quantity allowed for actual production. d.the standard quantity per unit.

c.the standard quantity allowed for actual production.

Dairy Delight, a producer of premium cheese products, decides that 10 quarts of milk is to be used to produce one pound of cheese and that the price to be paid for one quart of milk is $2. The standard cost of the milk per pound of cheese is: a.$12. b.$8. c.$10. d.$20.

d.$20. Standard cost of the milk per pound of cheese = Standard price for one quart of milk × Standard quarts of milk used for producing one pound of cheese = $2 × 10 quarts = $20

Northern Company provided the following information for the production of 5,000 packages of waffles for the month of May: Standard pounds of flour per package of waffles = 1.70 pounds Actual pounds of flour used: 8,000 pounds Standard price paid per pound of flour: $0.65 Actual price paid per pound of flour: $0.50 Based on the given information, the materials usage variance is: a.$240 favorable. b.$325 unfavorable. c.$240 unfavorable. d.$325 favorable.

d.$325 favorable. Materials usage variance = (Actual quantity − Standard quantity) × Standard price = (8,000 pounds − [1.70 pounds × 5,000 packages]) × $0.65 = $325 favorable

During May, 10,000 packages of chicken sausages were produced, for which 52,000 pounds of meat and 15,000 machine hours were used. The unit quantity standard is 5 pounds of meat per package, and the unit quantity standard for machine hours is 2 hours per package. Calculate the pounds of meat that should have been used for the production of 10,000 packages of chicken sausages. a.25,000 pounds b.70,000 pounds c.45,000 pounds d.50,000 pounds

d.50,000 pounds Pounds of meat that should have been used for the production of 10,000 packages of chicken sausages = Unit quantity standard × Actual output = 5 pounds of meat per packages × 10,000 packages of chicken sausages = 50,000 pounds of meat

In setting price standards, the purchasing manager must consider a.quality. b.freight. c.discounts. d.All of these choices are correct.

d.All of these choices are correct.

Using more highly skilled direct laborers might affect which of the following variances? a.direct labor efficiency variance b.variable manufacturing overhead efficiency variance c.direct materials usage variance d.All of these choices are correct.

d.All of these choices are correct.

Which of the following is true of currently attainable standards? a.Currently attainable standards demand maximum sales price. b.Currently attainable standards do not allow for normal breakdowns, interruptions, and less than perfect skill. c.Currently attainable standards demand maximum efficiency. d.Currently attainable standards can be achieved under efficient operating conditions.

d.Currently attainable standards can be achieved under efficient operating conditions.

Which of the following standards demand maximum efficiency and can be achieved only if everything operates perfectly? a.Kaizen standards b.Currently attainable standards c.Continuous improvement standards d.Ideal standards

d.Ideal standards

Which of the following statements is true if the direct materials price variance is immaterial? a.If the direct material price variance is immaterial, then the variance is closed to Finished Goods. b.If the direct material price variance is immaterial, then the variance is closed to Work-in-Process. c.If the direct material price variance is immaterial, then the variance is closed to Miscellaneous Expenses. d.If the direct material price variance is immaterial, then the variance is closed to Cost of Goods Sold.

d.If the direct material price variance is immaterial, then the variance is closed to Cost of Goods Sold.

Which of the following is the correct mathematical representation of unit standard cost? a.Unit standard cost = Standard price / Standard quantity b.Unit standard cost = Standard price × Actual quantity c.Unit standard cost = Standard price / Actual quantity d.Unit standard cost = Standard price × Standard quantity

d.Unit standard cost = Standard price × Standard quantity

The standard mix quantity for each direct material input is calculated by: a.multiplying standard mix proportion by total standard input quantity. b.multiplying actual mix proportion by total actual input quantity. c.multiplying actual mix proportion by total standard input quantity. d.multiplying standard mix proportion by total actual input quantity.

d.multiplying standard mix proportion by total actual input quantity.

Quantity price standards a.are standard price multiplied by standard quantity. b.specify how much of the quantity of input should be used for the actual price. c.specify how much of the quantity of input should be used for the standard price. d.specify how much should be paid for the quantity of input to be used.

d.specify how much should be paid for the quantity of input to be used.

If variable manufacturing overhead is applied based on direct labor hours and there is an unfavorable direct labor efficiency variance a.the direct labor rate variance will be favorable. b.the variable manufacturing overhead spending variance will be unfavorable. c.the direct materials usage variance will be unfavorable. d.the variable manufacturing overhead efficiency variance will be unfavorable.

d.the variable manufacturing overhead efficiency variance will be unfavorable.

Which of the following factors would cause an unfavorable material quantity variance? a.using higher quality materials b.using more highly skilled workers c.receiving discounts for purchasing larger than normal quantities d.using poorly maintained machinery

d.using poorly maintained machinery

Usage (efficiency) variance

the difference between standard quantities and actual quantities multiplied by standard price.

direct labor efficiency variance (LEV)

the difference between the actual direct labor hours used and the standard direct labor hours allowed multiplied by the standard hourly wage rate.

variable overhead efficiency variance

the difference between the actual direct labor hours used and the standard hours allowed multiplied by the standard variable overhead rate.

direct labor rate variance (LRV)

the difference between the actual hourly rate paid and the standard hourly rate multiplied by the actual hours worked.

direct materials price variance (MPV)

the difference between the actual price paid per unit of materials and the standard price allowed per unit multiplied by the actual quantity of materials purchased.

variable overhead spending variance

the difference between the actual variable overhead and the budgeted variable overhead based on actual hours used to produce the actual output.

direct materials usage variance (MUV)

the difference between the direct materials actually used and the direct materials allowed for the actual output multiplied by the standard price.

mix variance

the difference in the standard cost of the mix of actual material inputs and the standard cost of the material input mix that should have been used.

yield variance

the difference in the standard material cost of the standard yield and the standard material cost of the actual yield.

standard hours allowed

the direct labor hours that should have been used to produce the actual output (Unit labor standard × Actual output).

control limits

the maximum allowable deviation from a standard.

standard cost per unit

the per-unit cost that should be achieved given materials, labor, and overhead standards.

Price standards

the price that should be paid per unit of input.


संबंधित स्टडी सेट्स

Chapter 16: Postoperative Nursing Management

View Set

American Government(straighterline) Module 7

View Set

Tendons,Joints,Ligaments, Muscles

View Set

FINRA SIE Ch. 9 Practice Questions

View Set

NURS-342 - Chapt. 37 - MODULE 4 - Pediatric Nursing, Nursing Care of the Child with an Infection (Combined)

View Set

Precalc Prt2 Unit 1: Polar Coordinates and Complex Numbers

View Set

Section 10: Lender Loan Processes

View Set

IT Technical Interview Questions

View Set

Chapter 12 Advertising & Public Relations Quiz

View Set